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S&C, Akin Gump, Baker & McKenzie Lead on $7.1 Billion BP Asset Sale

Posted by Nick Rummell

Sullivan & Cromwell is spearheading the work for BP on the sale of its shares in an oil and gas venture in Argentina to Bridas Corporation and the Chinese state-owned energy company Cnooc, Ltd., in a deal worth nearly $7.1 billion.

BP announced the sale of Pan American, an oil and gas company co-owned with Bridas, on Sunday. Money raised from the deal will help the U.K.-based oil giant to offset some of the costs incurred from the Gulf of Mexico oil spill--the company faces $40 billion in estimated claims stemming from the disaster. This latest asset sale brings to $21 billion the amount raised by BP to pay out the claims, according to The New York Times.

Leading the S&C team for BP is London-based partner Stewart Robertson, who has handled several deals for the oil and energy company, and has negotiated a number of other high-profile energy transactions in the Middle East and South America. Robertson is joined by special counsel Brian Pierce, also in London, who specializes in cross-border mergers and acquisitions. Rupert Bondy is BP's general counsel.

Bridas has turned to longtime outside counsel Akin Gump Strauss Hauer & Feld, with Steven Blakeley in London and Seth Molay in Dallas leading a team that consists of eight other lawyers. The firm recently advised Bridas on a joint venture with Cnooc. That deal, announced in March, saw Cnooc take a 50 percent stake in Bridas as a first step in the Chinese company's plans to expand into Latin America, as we previously reported.

"This is a very significant transaction," Blakeley says of the BP sale, noting the high profile of the companies involved and the hefty purchase price. For now, Bridas has no plans for additional transactions with Cnooc or BP, Blakeley says, adding that, "in the oil and gas world, you never know."

Cnooc is represented by Baker & McKenzie, with Bee Chun Boo in the firm's Shanghai office leading the legal team, according to Blakeley. Boo, who did not respond to e-mail messages seeking comment, led the firm's work on the Bridas joint venture in March, along with Baker & McKenzie Beijing-based partner Stanley Jia, according to our prior reporting. Liguo Zhao is Cnooc's general counsel.

Under the terms of the current deal, Bridas and Cnooc each have agreed to pay $2.47 billion for the BP assets. The rest of the financing will come from third parties or additional funds from both companies, according to statements from the companies announcing the deal.

Pan American is considered the second-largest oil and natural gas producer in Argentina, according to BP. Once the deal closes, Cnooc expects proven reserves to increase by 429 million barrels of oil while the average daily production will jump to 68 thousand equivalent barrels, according to figures cited in a Cnooc statement.